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James Daley profiles a fast-rising contender in the retail market

With over 150 fund management companies in the UK, IFAs are spoilt for choice when it comes to selecting a fund. Many advisers go straight for the big names but a look beyond reveals a number of smaller houses which are producing promising returns and a more personal service.

Premier Asset Management is one such house. Having just passed its first big landmark of £500m under management, it is now stepping up its strategy to become a serious player in the UK retail market.

Its latest offering is a new fund of funds product called the c-lect Portfolio, which offers investors with more than £20,000 exposure to a range of the UK&#39s top-performing unit and investment trusts.

The portfolio is split into three funds of funds – a balanced fund, growth fund and aggressive growth fund. Each holds between 20 and 35 investments and investors can choose the weighting they want to have in each section of the overall portfolio.

Its main appeal to IFAs will be the generous levels of commission. Initial commission is 4 per cent from a 5 per cent initial charge while renewal commission is 0.25 above the normal 0.5 per cent, at 0.75 per cent.

The product offers regular cash withdrawals which can be paid directly into the client&#39s bank account. Client breakdowns of all investments held within the portfolio are issued every six months.

The Guildford-based fund manager was set up in 1985 and a year later, Jonathan Fry joined the firm to set up Premier Fund Managers which concentrated principally on private client portfolios. But its acquisition of Brewin Dolphin in the late 80s gave the firm the base of its unit trust range, which it has been building on ever since.

As a small investment house, Fry believes it is important to realise the firm&#39s limits. As a result, several of the funds are managed externally through companies such as Laing & Cruickshank and First Union.

Fry says: “We feel strongly that no fund manager can be good at everything so we have a range of funds that we manage in house and a range that we manage outside.”

Premier has also marked itself out from the average fund manager by remaining unrated by Standard & Poor&#39s fund research. Fry believes a firm of its size will not necessarily receive worthwhile rewards from S&P ratings in comparison with the heavy cost.

Instead, the firm produces its own research, including both qualitative and quantitative assessments of unit and investment trusts. Its regular rankings and risk tables are distributed free to IFAs.

As part of its plans to grow, Premier sold 24 per cent of its business to Canada&#39s biggest independent mutual fund manager MacKenzie last year. It is now on the acquisition trail for other small fund managers. It has also exploited its Canadian link by launching clones of its Global 100 and Euro 100 funds into the Canadian market last month.

With most of its business accounted for by the IFA market, Premier is keen to build very strong relationships with the intermediary community. Fry says: “When you look at all the major fund managers, they are all busy going global and getting bigger but they are forgetting that there are still thousands of IFAs who are becoming increasingly investment-specialised and need looking after.”

By remaining attentive to the needs of the IFA whilenot trying to do too much too quickly, Fry believes Premier is well placed to become a big player over the next five years.

The signs seem promising, with IFAs slowly starting to take a second look at the boutique manager. Bates Investment director Graham Bates says: “I have long said that it is a group to watch. Jonathan Fry is a different breed of chief executive and I have a lot of respect for them. I expect that we will see them flourish over the next five years.”


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